General Assistance would end, and some low-income workers would lose MinnesotaCare health coverage.
Gov. Tim Pawlenty's proposal to cut a net of $347 million from programs for sick, aged, disabled and jobless people is akin to the advice an ailing George Washington got from his doctors 210 years ago, one critic said Monday: Bleed him, in hope of a cure.
Pawlenty would eliminate the General Assistance program in which about 20,000 disabled and very-low-income people receive an average of $175 a month.
He also would remove about 21,500 childless adults earning between $8,100 and $27,000 from MinnesotaCare, the health insurance program for lower-income working people.
MinnesotaCare is subsidized by the Health Care Access Fund, financed by a surcharge on providers and insurers. Pawlenty would take $47 million from the fund and use it to help balance the budget, as he has in the past.
He also could cut $10 million from a $47 million statewide plan designed to reduce smoking and obesity in each county, also financed by the access fund.
The governor actually proposed $734 million in cuts but assumed the state will receive $387 million in federal Medicare funds if Congress votes to extend last year's economic stimulus legislation.
Advocates for health care providers and Minnesota's poor greeted Pawlenty's proposals with dismay.
"Minnesota is sick," said Nan Madden, director of the Budget Project for the Minnesota Council of Nonprofits, "but slashing programs that work to strengthen our economy over the long term isn't going to help us recover."
"You know, this is exactly the wrong thing to do," said Lorry Massa, president of the Minnesota Hospital Association. "At a time when we need to help people keep jobs and keep healthy, these cuts could give us just the opposite."
Conditions would worsen at nursing homes under a proposed 2.5 percent cut in Medicaid rates, said Gayle Kvenvold, CEO of the trade group Aging Services of Minnesota.
About one-fourth of the facilities already operate at a loss because state Medicaid payments average $20 a day below costs, she said. "There is no lean left, no place with too many employees or too much care."
DFL leaders responded to the governor's ideas skeptically. "This is [an] 'over-my-dead-body' kind of thing," said Rep. Tom Huntley, DFL-Duluth, whose Health Care and Human Services Finance Division will hear more details Wednesday from administration officials. "We'll need cuts, yes, but we have to look at the other side of the equation, too, generating new revenue."
In the meantime, legislators, advocates and those who work with scores of programs said they are struggling to understand the impact of proposed cuts.
Warren Wolfe • 612-673-7253